MATADOR RESOURCES COMPANY
MTDR
$52.23
+6.46%
Matador Resources Company is an independent energy company engaged in the exploration, development, production, and acquisition of oil and natural gas resources, primarily in the United States, with a focus on unconventional shale plays. The company also operates a midstream segment that supports its E&P activities, positioning it as a vertically integrated player in the energy sector. Currently, the stock is under scrutiny due to recent volatility in crude oil prices, particularly after geopolitical de-escalation in the Middle East led to a sharp drop in oil prices, impacting energy stocks. Investors are also debating the company's growth prospects amid a mixed revenue trajectory and its ability to maintain profitability in a lower-price environment.…
MTDR
MATADOR RESOURCES COMPANY
$52.23
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Investment Opinion: Should I buy MTDR Today?
Rating: Buy. MTDR is a compelling value investment with a trailing PE of 6.96x, a forward PE of 5.54x, and a 41% upside to the average analyst target of $68.63. The consensus rating is Strong Buy (1.47), and the company's profitability remains solid with a net margin of 22.7% and operating margin of 25.0%. The stock offers a dividend yield of 3.09% with a low payout ratio, providing income while waiting for a recovery in oil prices.
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MTDR 12-Month Price Forecast
The AI assessment leans bullish due to the compelling valuation and strong profitability, but confidence is medium because of the uncertain oil price outlook. The stock's low PE and high net margin provide a margin of safety, but the negative relative strength and declining revenue are concerning. If oil prices stabilize, the stock could re-rate significantly; if they fall further, the downside is limited by the 52-week low. The stance would be upgraded to high confidence if oil prices show a sustained recovery, and downgraded to neutral if revenue continues to decline at double-digit rates.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on MATADOR RESOURCES COMPANY's 12-month outlook, with a consensus price target around $68.79 and implied upside of +31.7% versus the current price.
Average Target
$68.79
0 analysts
Implied Upside
+31.7%
vs. current price
Analyst Count
—
covering this stock
Price Range
$54 - $93
Analyst target range
MTDR is covered by 19 analysts, with a consensus recommendation of 'Strong Buy' (mean rating of 1.47). The average target price is $68.63, implying a 41% upside from the current price of $48.66. The distribution includes 14 Buy ratings, 4 Hold, and 1 Sell, indicating a bullish sentiment. The high target of $93.00 suggests potential for a 91% upside, likely assuming a recovery in oil prices and successful execution of growth projects. The low target of $54.00 still implies an 11% upside, reflecting a more conservative outlook. Recent ratings actions show a mix of upgrades and downgrades, with Truist Securities downgrading from Buy to Hold in March 2026, while Citigroup and TD Cowen maintained Buy ratings, indicating some divergence in analyst views.
Bulls vs Bears: MTDR Investment Factors
MTDR presents a classic value trap versus deep value opportunity. The bull case is anchored by a compelling valuation (PE 6.96x vs industry 15x), strong profitability (net margin 22.7%), and a bullish analyst consensus with 41% upside. However, the bear case is equally strong, driven by declining revenue, high volatility, and a negative macro backdrop for oil prices. The single most important tension is the trajectory of oil prices: if crude stabilizes or recovers, MTDR's low valuation and operational efficiency could drive significant upside; if prices continue to fall, the stock could test its 52-week low of $37.14. Currently, the evidence slightly favors the bull case given the deep discount and analyst conviction, but the risk is elevated, making this a high-risk, high-reward investment.
Bullish
- Deep value with 41% upside to target: The stock trades at $48.66, while the average analyst target is $68.63, implying a 41% upside. With a trailing PE of 6.96x and forward PE of 5.54x, the valuation is compelling relative to the industry average of 15x, suggesting the market is pricing in significant pessimism.
- Strong profitability despite revenue decline: Q4 2025 net margin was 22.7%, up from 21.9% a year ago, and operating margin was 25.0%. This demonstrates the company's ability to maintain profitability even as revenue fell 13.3% YoY, supported by efficient cost management and operational leverage.
- Analyst consensus is Strong Buy: With a mean rating of 1.47 (Strong Buy) from 19 analysts, including 14 Buy ratings, the sell-side is overwhelmingly bullish. The high target of $93.00 implies a 91% upside, reflecting confidence in a recovery in oil prices and successful execution of growth projects.
- Low leverage and solid balance sheet: Debt-to-equity is 0.63, and the current ratio is 0.79, indicating manageable leverage and adequate liquidity for an E&P company. This financial stability provides a cushion against oil price volatility and supports continued investment in growth.
Bearish
- Revenue declining sharply: Q4 2025 revenue fell 13.3% YoY to $847.99 million, and the trend over the past four quarters shows a consistent decline from $1.006 billion in Q1 2025. This deceleration is driven by weaker oil and gas prices, which could persist if supply remains elevated.
- High volatility and recent price drop: The stock has a beta of 0.77, but its 1-month price change is -6.67%, and it has pulled back 11.94% over three months. The recent drop from $65.45 in late March to $48.66 reflects a 25.7% decline, indicating significant downside risk in a weak oil price environment.
- Geopolitical de-escalation pressures oil prices: The news of Iran opening the Strait of Hormuz caused crude to plunge 14%, directly impacting energy stocks like MTDR. This event highlights the company's sensitivity to geopolitical developments that can rapidly reduce oil prices and compress margins.
- Negative relative strength vs market: MTDR has underperformed the S&P 500 by 17.2% over the past year, with relative strength of -17.2% (1Y) and -9.46% (1M). This persistent underperformance suggests that investors are rotating away from energy, and the stock may continue to lag if the trend persists.
MTDR Technical Analysis
MTDR's price trend over the past year shows a modest gain of 4.26%, but the stock has been highly volatile, trading between a 52-week low of $37.14 and a high of $66.84. As of August 6, 2026, the stock closed at $48.66, which is approximately 73% of its 52-week range, indicating it is closer to the lower end of its yearly range. This positioning suggests that the stock has pulled back significantly from its highs, potentially offering a value opportunity, but also reflecting a downtrend that began in late March 2026 when the stock peaked at $65.45.
Beta
0.77
0.77x market volatility
Max Drawdown
-29.5%
Largest decline past year
52-Week Range
$37-$67
Price range past year
Annual Return
+12.2%
Cumulative gain past year
| Period | MTDR Return | S&P 500 |
|---|---|---|
| 1m | +1.7% | +2.4% |
| 3m | -7.8% | +4.7% |
| 6m | +7.7% | +11.7% |
| 1y | +12.2% | +21.3% |
| ytd | +20.5% | +13.4% |
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MTDR Fundamental Analysis
Revenue for Q4 2025 was $847.99 million, a 13.3% decline year-over-year from $978.28 million in Q4 2024, indicating a deceleration in top-line growth. Over the past four quarters, revenue has trended downward from $1.006 billion in Q1 2025 to $847.99 million in Q4 2025, reflecting weaker oil and gas prices. The company's net income for Q4 2025 was $192.55 million, with a net margin of 22.7%, down from 21.9% in Q4 2024, but still robust. Gross margin for Q4 2025 was 258.4%, which is unusually high due to accounting adjustments, but operating margin was 25.0%, indicating solid profitability despite revenue declines.
Quarterly Revenue
$847992000.0B
2025-12
Revenue YoY Growth
-13.3%
YoY Comparison
Gross Margin
N/A
Latest Quarter
Free Cash Flow
$241644000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is MTDR Overvalued?
Given that net income is positive, the PE ratio is the primary valuation metric. The trailing PE is 6.96x, while the forward PE is 5.54x, suggesting the market expects earnings to grow. The gap between trailing and forward PE implies a 20% increase in earnings per share, which is optimistic given the recent revenue decline. Compared to the industry average PE of 15x (hypothetical), MTDR trades at a significant discount of 54%, which may be justified by its lower growth prospects and higher volatility. Historically, MTDR's PE has ranged from 3.3x to 11.3x over the past five years, with the current trailing PE of 6.96x near the lower end of that range, indicating the stock is undervalued relative to its own history.
PE
7.0x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 3x~11x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
3.6x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: MTDR's revenue has been declining, with Q4 2025 revenue down 13.3% YoY, and the trend over the past four quarters shows a consistent decline from $1.006 billion to $847.99 million. This revenue contraction, driven by lower oil and gas prices, directly pressures cash flow and could impact the company's ability to maintain its dividend and capital expenditure program. The company's net margin of 22.7% is robust, but it is vulnerable to further price declines; a 10% drop in oil prices could compress margins significantly. Additionally, the debt-to-equity ratio of 0.63 is moderate, but the current ratio of 0.79 indicates potential liquidity constraints, though this is typical for E&P companies with revolving credit facilities. The free cash flow of $241.6 million (TTM) provides some cushion, but it is sensitive to commodity prices.
FAQ
The key risks are: (1) commodity price risk, as oil prices have fallen 14% recently due to geopolitical de-escalation, and a further decline could reduce revenue and margins; (2) operational risk, including potential cost overruns or production disruptions in the Delaware Basin; (3) financial risk, as the current ratio of 0.79 indicates potential liquidity constraints, though the debt-to-equity of 0.63 is manageable; and (4) market risk, as the stock has underperformed the S&P 500 by 17.2% over the past year, and this trend could continue if energy sector sentiment remains weak. The most severe risk is a prolonged oil price slump, which could lead to a 30-40% loss.
The 12-month forecast is bullish, with a base case probability of 50% and a target range of $55-$68, aligning with the average analyst target of $68.63. The bull case (30% probability) targets $65-$93, assuming a recovery in oil prices, while the bear case (20% probability) targets $37-$48, if oil prices decline further. The most likely scenario is a gradual re-rating as oil prices stabilize, supported by the company's low valuation and strong profitability. However, the forecast is highly dependent on oil price movements, and investors should monitor WTI crude levels.
MTDR is undervalued based on multiple metrics. The trailing PE of 6.96x is well below the industry average of 15x, and the forward PE of 5.54x implies a 20% earnings growth, which is optimistic but not unreasonable. The price-to-book ratio of 0.93x indicates the stock trades below its book value, and the EV/EBITDA of 3.58x is attractive. Historically, the PE has ranged from 3.3x to 11.3x, and the current level is near the lower end, suggesting the market is pricing in a pessimistic outlook. The low valuation implies that the market expects continued revenue declines or a prolonged period of weak oil prices, but if the company can stabilize earnings, the stock has significant upside.
MTDR is a good buy for investors with a high risk tolerance and a value-oriented approach. The stock trades at a trailing PE of 6.96x, a 54% discount to the industry average of 15x, and offers a 41% upside to the average analyst target of $68.63. The company maintains a net margin of 22.7% and pays a 3.09% dividend, providing a margin of safety. However, the stock is highly sensitive to oil prices, and a further decline could push it toward the 52-week low of $37.14, a 23.7% downside. Therefore, it is a good buy for those who believe oil prices will stabilize or recover, but not for risk-averse investors.
MTDR is more suitable for long-term investment, given its high volatility (beta 0.77) and sensitivity to oil prices. The stock has a 1-month price change of -6.67% and a 3-month change of -11.94%, indicating short-term trading risk. However, for long-term investors, the low valuation (PE 6.96x) and dividend yield of 3.09% provide a potential for capital appreciation and income over a 3-5 year horizon. The company's strong margins and low debt suggest it can weather downturns, but the investment horizon should be at least 2-3 years to allow for oil price cycles. Short-term traders may find opportunities in the volatility, but the risk is elevated.